NEW DELHI: KFC and Pizza Hut parent Yum Brands will rebuild its Mexican restaurant chain, Taco Bell, in India after having had a slow start in the country, said a senior executive of the fast-food company. Taco Bell, having been present in India for two years will now boast of 60% localized and vegetarian offerings, a first for the Mexican chain anywhere in the world. It will also look to expand beyond Bangalore in an attempt to scale up in a fast growing Indian quick-service restaurant market.

Over the last two years, Yum has been aggressively opening its KFC stores and expects to have 1,000 outlets by 2015 across its brands here. "We are very excited with the way consumers have taken to Taco Bell, we have been in the proof of concept mode over the last two years but are now ready to take Taco Bell to the next level," said Niren Chaudhary, president of Yum Restaurants India, a subsidiary of Yum Brands, who now reports directly to Yum's chief executive David Novak.

Taco Bell, which has US as its biggest market, serves tacos, burritos, quesadillas and nachos, among other Mexican fare. um! Brands is looking to generate a billion dollars in revenue in the next three years from its Indian operations, largely backed by the KFC brand. The Louisville, Kentucky-based group expects to close 2012 with 600 stores. Taco Bell, which currently has three stores in Bangalore, added products like Kathitto, a kathi roll with burrito fillings inside, and other such fusion offerings to establish a connect with Indian consumers.

Yum's other successful competitors in the Indian fast-food market, including McDonald's and Domino's Pizza, have all localized their menus to become more relevant to consumers here. While some have opened 100% vegetarian stores, others have increased the share of Indianized items on their menus to suit local tastes. Yum has a 40% vegetarian spread across its KFC, Pizza Hut and Taco Bell menus. Along with the spruced up vegetarian menu at Taco Bell, Yum is also looking to increase its vegetarian offerings for its flagship KFC in India. "Vegetarian food has a resonance among Indians even if they are non-vegetarians. We want to include more vegetarian in our KFC menu and may add tortilla based wraps and rice meals going forward," Chaudhary said.

At present, KFC has around 15% vegetarian products. Yum is also looking to grow its Pizza Hut delivery model in India where it faces intense competition from market leader Domino's Pizza. Last year in November, KFC's parent Yum Brands made its India operation a stand-alone unit as it looks to bring down its dependence on China, which contributes almost half of Yum's revenue, and push other emerging markets like India, Russia and Brazil. The fast-food operator is hoping to replicate the China model of pushing KFC as its biggest growth driver in India as well.

Yum China has more than 5,000 restaurants, largely dominated by KFC, but has recently said it will look to grow its high-margin Pizza Hut stores in the wake of a cooling market and growing competition.